Ways to hedge against a heavy loss in extreme situations for a scalper

Discussion in 'Index Futures' started by CALLumbus, May 18, 2018.

  1. maxinger

    maxinger

    you are right mister.

    For investors, if stock price is collapsing, they shouldn't be holding on to their dear stock .
    then hedge by shorting futures, buying put option, selling call option.


    they should reduce their stock quantity, or simply cut loss totally.
     
    #51     Jul 13, 2018
    murray t turtle likes this.
  2. %%
    LOL, true, partly:D:D. But any kind of insurance can be wise.If your car is paid for, + my HMC 4 cylinder is; a high deductible insurance policy can be wise . Many states require liability..:caution::cool:..... A good insurance rule is insure anything you don't want to / or cant afford to replace.
     
    #52     Jul 13, 2018
  3. tommcginnis

    tommcginnis

    Exactly right, Handle123 --
    three kinds of hedges:
    1) "Mirror" or negatively-correlated,
    2) "Redundant" or positively-correlated,
    3) "Disconnected" or non-correlated.

    In common usage, people concentrate on mirror hedges -- forgetting about useful redundant(s) or non-correlated(s).
     
    #53     Jul 13, 2018
  4. %%
    Thats one way to do it. Another way to do it, but dont try this @ home as they say; Mr Carl Ichan, instead of putting up a '' hedge fund gate, 2008 ''/ bear. He let his investors out by taking the money from another account + NOT selling stocks. Wise move ; i would rather do that with ETFs.LOL+true. By the way he cut loss on CHK, so thats not a mindless rule also.LOL:cool::cool:
     
    #54     Jul 13, 2018
  5. maxinger

    maxinger

    Hedging is for newbies who try to be professional.

    Hedging is for professional who want to sound professional and almighty.


    This is my opinion.
    I don't hedge because I disagree with the concept.
    But do hedge if you want to.


    -------------------------
     
    #55     Jul 13, 2018
  6. I would add for your list the order types which are native to the exchange. This means when you put stoploss order in it goes directly to the exchange books and sits there. In the case of emergency this will cover every possible situations except the vanished bids and offers.

    Now you can have a computer or connection malfunction or broker's server can crash etc.
     
    #56     Jul 22, 2018
    CALLumbus likes this.
  7. CALLumbus

    CALLumbus

    A good point, thank you for your input !
     
    #57     Jul 22, 2018
  8. For the vanished bid and offers use LLC and broker who require no personal guarantees.
     
    Last edited: Jul 22, 2018
    #58     Jul 22, 2018
    CALLumbus likes this.
  9. Call,

    You have done what you can do with all of the redundencies in place.

    What I do is to always remove half of my profits each day or week and let the rest ride. Spending the money along the way is your only hedge.

    Sure you can save up an emergency fund. You can invest in vehicles that are insulated against catastrophic world events. Buy art and collectibles might be a thought. Somehow you will need to segregate funds along your profitable journey in Futures Scalping. ...but again spending the money is your only hedge.

    ES

    P.S. don't forget to pay yourself labor from your Futures trading. I use $35.00/Hr.

     
    #59     Aug 3, 2018
    CALLumbus likes this.